The International Coffee Organization, Free Trade, And Fair Trade

1208 WordsDec 17, 20155 Pages
Did you know that coffee is the second most traded commodity in the world? Second to oil, the coffee industry employs millions of people to trade, process, grow, and produce coffee (BBC News). In this paper I will address if the coffee industry is fair to its producers and consumers. I will also discuss different fiscal organizations that directly affect the coffee industry’s prices like the International Coffee Organization, World Trade Organization, Free Trade, and Fair Trade. I will also touch upon of the coffee industry influences farmers, middleman, and consumers. In 1963, the International Coffee Organization (ICO) was established. The ICO was first made to assist the economies in Africa and South America. This organization abides by international agreements made under the supervision of the United Nations. The ICO is the most effective agreement produced to control the supply of coffee. These agreements contributed a quota system and price control that benefited both importing and exporting nations. Not only was the ICO fair to both sides, it also provided a fair price to the consumer which resulted in the rise in consumption (The Economics of Coffee). Shockingly, most of the success of the ICO was allocated to the United States. The United States helped enforce the quota system to help provide a stabilized economy for poor Latin American countries. Enforcing the agreements also prevented communism in these countries. Once the United States withdrew from the

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